Age of Reason; Compliance Comes of Age
Attitudes towards compliance have changed enormously in the last few years. The financial crisis and massive corporate failures have highlighted the need for effective compliance and risk management. The ‘business prevention unit’ philosophy now rests only with the lingering dinosaurs of yore and it is companies that embrace compliance that are now set to succeed and thrive in the new landscape.
Increasingly firms are taking a pro-active approach to compliance. This requires buy-in from senior and middle management. Compliance sometimes requires a change in culture and needs to be led from the top. However it is the responsibility of the entire organisation and should be seamlessly integrated with business processes. Compliance makes commercial sense and can offer a competitive advantage and is something firms should strive for. Good governance and good compliance go hand in hand in with the ethics and values of a firm and can facilitate the success of the company. A healthy compliance culture leads to improved efficiency and avoidance of unnecessary cost.
Compliance officers should no longer lurk in the back-rooms but should be the approachable first port of call for a concerned employee. Compliance professionals should understand all areas of the business and be accessible to form an effective partnership. Training with relevant business case studies and repeated reminders of why compliance is important and how it can help the business are all part of fostering new attitudes towards compliance. There should be ownership of risk and accountability.
Compliance connects corporate governance, ethics and corporate social responsibility assisting firms to attain high standards and achieve their goals. Once a firm embraces the issues savings can be made, less rework on new products can result in lower operating cost. A strong ethical reputation can result in an increase in clients. New products and services can reach the market faster as they are compliant from the start. There is without doubt a real return on investment when compliance is firmly embedded in a businesses culture and it really can offer a competitive advantage.
Topics: Compliance
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Member Comments
Kevin Warmack, 01 Apr 2010 13:57
This article clearly hits all points. Compliance is not just the "dirty little secret that's down the hall in the broom closet." Compliance is a major function of the business in that it clearly drives the bottom line of firms. Great compliance has to be led from the top down and the feeling throughout the organization has to be made that non-compliance is costly not only in terms of fines and/or suspensions but reputation as well. Bottom line - You can pay compliance now or pay the regulators later. And the regulators usually cost more in the long run.
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